RONA accepts C$283.17 million of 5.4% notes in Dutch auction tender

By Jennifer Chiou

New York, Nov. 29 - RONA Inc. said it accepted tenders for C$283,171,000 of its C$400 million of 5.4% debentures due Oct. 20, 2016 in the modified Dutch auction offer for up to C$300 million of the notes.

The company has also withdrawn the second offer for the debentures, which was to start at 9 a.m. ET on Nov. 29 and end at 5 p.m. ET on Dec. 12. The start time had been pushed back from Nov. 23, and the amount to be paid in the subsequent offer was the amount in the first offer less C$30 for each C$1,000 principal amount of accepted debentures.

Holders could tender debentures until 5 p.m. ET on Nov. 28 under the first offer, and settlement is set for Dec. 1.

The purchase price was determined to be C$1,022.73 per C$1,000 principal amount of debentures plus interest amounting to C$19.8247, resulting in aggregate consideration of C$289,607,477 plus an additional C$5,613,780 for accrued interest.

As of Nov. 22, C$242,925,000 of the debentures had been tendered under the offer.

The offers were announced on Nov. 3 with the overall amount to be accepted originally set at C$200 million of debentures.

On Nov. 15, RONA announced an acceptable bid range of C$1,001.19 to C$1,022.73 for each C$1,000 principal amount of debentures.

As previously noted, the reference yield as of 9 a.m. ET on Nov. 15 for the 2.75% Government of Canada bond due Sept. 1, 2016 was 1.374%. The range was set using the reference yield plus 350 basis points to 400 bps.

Participating holders had to specify a bid price in C$0.01 increments within the cited range. Those who tendered without picking a bid price were deemed to have specified C$1,001.19, the lowest price.

The offer began on Nov. 3, and the first part was originally set to end at 5 p.m. ET on Nov. 22.

Scotia Capital Inc. was the dealer manager (888 776-3666 or 416 863-7257). Kingsdale Shareholder Services Inc. was the information agent (866 851-2743 or 416 867-2272). Questions were to be directed to Computershare Investor Services Inc. (800 564-6253 or 514 982-7555).

Boucherville, Quebec-based RONA is Canada's largest hardware and gardening retailer and distributor.

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